City To Consider Minority, Women Contracts Plan

HAMPTON — A new plan outlines ways the city might improve its record of doing business with minority- and women-owned businesses.

The plan is a follow-up to a disparity study, released in January 2006, which examined spending on goods and services by the city and the school division between 1999 and 2003.

The disparity study showed that Hampton mostly left out minority-owned and women-owned businesses, which were a small fraction of companies available to do business in this region. For instance, black-owned construction companies accounted for 4.38 percent of all prime contractors in the area and received 1.05 percent of Hampton's construction spending for prime contractors between 1999 and 2003.

City staff will recommend that the council approve the Minority and Woman Owned Business Program Plan during the council meeting at 7 p.m. Wednesday in the Council Chambers on the eighth floor of City Hall. The council is also asked to approve an ordinance to change procurement procedures, which also requires the school division to comply with the new rules.

The document offers spending goals - how much taxpayer money should go to companies owned by minorities and women. The goals were established in the disparity study based on the percentage of minority-owned and women-owned businesses available in the "relevant market," which extends beyond Hampton Roads.

For example, of the millions of dollars Hampton spends annually on prime contractors, 4.34 percent should go to minority-owned businesses and 3.82 percent should go to non-minority women-owned businesses. For all spending on architecture and engineering services, 2.86 percent should go to minorities and 4.76 percent should go to non-minority women.

The issue of contracting and how much business Hampton does with minorities and women came up during the City Council campaign last year. Councilman George Wallace, who was city manager when Hampton paid to have the disparity report done, asked during public forums why the city hadn't done anything with the results of the disparity report.

The city established a Minority Business Program Office, and staff have come up with strategies to increase the amount of business Hampton does with minorities and women. This new plan is different from old plans in two major ways, said Finance Director Karl Daughtry.

For one, a contractor who doesn't adhere to the subcontracting plan would suffer a loss of payment or be kept from future bidding by the city.

"That's what gives this some teeth," Daughtry said. "There's some ramification if you don't put forth a good-faith effort."

Another advantage to the current plan: contractors won't have to get a performance bond for providing a good or service unless the value is $100,000 or more, Daughtry said. Current procurement rules require contractors to get a bond for work valued at $10,000 or more, and that has precluded some minority- and women-owned businesses from doing the work.

A performance bond has a cash value that can be used if a contractor doesn't perform the work to the designated standards, and it can be used to pay for a different company to finish the job.

City staff and the Purchasing and Procurment Oversight Committee will be checking whether the new plan is successful based on regular reports of spending. The plan also calls for holding city staff accountable for the goals.

GOALS

Hampton is considering goals for how much spending should go to minority- and women-owned businesses for various types of city-purchased goods and services. The percentages are based on the percentage of firms available in the "target market," which extends beyond Hampton Roads.